Recent findings from Moody's Investors Service indicate that President-elect Barack Obama's health-care proposals, if enacted, could galvanize the industry. The plans, which call for expanding the availability of health insurance and reducing health-care costs, could also increase demand for health-care management jobs.

"If more people have health insurance, more people can get non-emergency service and hospitals can better cover their costs," says Lisa Goldstein, a senior vice-president at Moody's who has analyzed the health-care industry for 18 years. "This is an attractive time for students to consider careers in health management."

A Renewed Enthusiasm

In the U.S., health care is a $2.26 trillion industry—comprising about 15.2% of the U.S. economy—and it continues to grow. According to the U.S. Health & Human Services Dept., the health share of gross domestic product is expected to reach 19.5% by 2017, up 4.3% from its current share. Larger hospitals, such as Northwestern Memorial in Chicago and Stanford Hospital in Stanford, Calif., individually have revenues exceeding $1 billion.

Yet many argue the system is flawed. In his plan, Obama pinpoints several chief shortcomings: Health insurance premiums have doubled in the past eight years, rising nearly four times faster than wages. One-quarter of all medical spending goes to administrative and overhead costs. Roughly 100,000 Americans die every year from medical errors in hospitals. And more than 45 million Americans lack health insurance altogether.

In other words, "the demands on our health-care system and the demands for strong health-care management have never been greater," says Gary Mecklenburg, the former president and CEO of Northwestern Memorial HealthCare, the parent corporation of Northwestern Memorial.

Industry in Flux

Yet top business school students have typically flocked en masse to other industries. (In 2008, only 2% of Harvard Business School grads went into health-related industries.) Lured by "the megabucks of Wall Street," they ignored health-care management to pursue finance and consulting, says David Dranove, a professor of health-industry management at Northwestern's Kellogg School of Management. As a result, he says, health-care providers recruited most of their talent from schools of public health.

Indeed demand for health-care MBAs outstrips supply, according to a report from the W.P. Carey School of Management at Arizona State University. As of earlier this year ASU said there were about 75 accredited programs in health management; virtually all of ASU health-care grads got jobs within three months of graduation.

In recent months, however, Northwestern's Dranove has seen "a renewed enthusiasm" for health-care management. He says the number of Kellogg students interviewing for positions in the health-care industry has more than doubled since 2005. And health-care providers have embraced the attention: They're coming to campus for the school's first-ever Provider Day, during which they'll discuss career growth opportunities.

"Students used to say: 'I want to work for a big, prestigious corporation, not a hospital,'" says Dranove. "Now, they're starting to realize those two are one and the same."

A Stable Choice

Of course, Wall Street's downward spiral (BusinessWeek.com, 12/1/08)—and the resulting stream of corporate layoffs (BusinessWeek.com, 11/27/08)—likely hastened this change of heart. During times of economic turmoil, the health-care industry tends to thrive: It was one of the few fields to expand during the dot-com bust.

"There's not a lot of swing in health care," says Kristi Raube, the executive director of the University of California at Berkeley's graduate program in health management at the Haas School of Business . "It's like a steady growth engine."

For business school students seeking job security, pursuing health-care management is "one of the most stable" career options, because people will always need care, says Mecklenburg. And right now, the industry is poised to expand: According to the Health & Human Services Dept., the health share of the GDP is expected to reach 19.5% by 2017, up 4.3% from its current share.

But as Inauguration Day looms, so do federal budget cuts. If they target Medicare and Medicaid—which comprise roughly 60% of the average hospital revenue base—health-care providers could be forced to downsize just as investment banks and automakers have, says Goldstein. "No industry is [recession-proof]," she says.